Truck-hailing platform Full Truck Logistics, which is known as Manbang in China, on Thursday filed for an IPO on the New York Stock Exchange, without disclosing details about the size of the offering. CNBC reported earlier this month that the startup could raise around USD 1.5 billion, citing a person with knowledge of the matter.
Manbang was created in 2017 after the merger of the logistics firms Yunmanman and Huochebang. Both companies provided freight listing services through QQ and WeChat groups—a first step toward the digital transformation of the industry—and then launched mobile apps in 2013 and 2014, respectively.
Typically, it took days for shippers to locate a trucking firm or a driver, going through multiple layers of middlemen, while truckers spent a similarly long time securing their next shipment. The matching usually took place in logistics parks where “shipping orders were written on blackboards in a disorganized manner, with most of the negotiation process conducted over the phone or in person,” according to Manbang’s prospectus.
Manbang claims to be the world’s largest digital freight platform. It spans more than 300 cities and operates over 100,000 routes in China. The company logged RMB 173.8 billion (USD 26.6 billion) in gross transaction value in 2020, the company said in its filing, citing data about industry players compiled by China Insights Consultancy (CIC). By the end of last year, 2.8 million truckers were registered on Manbang, and in December, 1.33 million shippers posted orders. CIC further found that approximately 20% of all heavy-duty and medium-duty truckers in China used the platform in 2020. Manbang’s competitors include Lalamove, which is also known as Huolala, and Didi Freight.
The company, which is backed by Tencent and SoftBank, says that it is still in the early stages of monetizing its online services. In 2018, it launched a membership service for frequent shippers, allowing paying customers to post more orders than non-paying users who can ship limited quantities of cargo for free. Manbang collects the difference between the shipper’s bid and a trucker’s offer. In August 2020, it began charging commission from truckers.
Based on feedback from a user of Manbang, users see a higher volume of potential matches by paying extra charges. One shipper surnamed Wang told KrASIA that she forked over RMB 1,688 in membership dues, but at times has trouble matching with truckers, even when she knows that there are drivers who are using Manbang to find work.
Wang said that drivers also need to pay fees—the more they paid, the more orders became available to them. “This artificially creates a situation for drivers where there are more trucks than needed by shippers,” Wang said.
There have been other hitches for users of Manbang’s platform. A driver surnamed Shi told KrASIA that in early May he accepted an order to transport around 30 tons of watermelons from Shandong province to Xinjiang. The match involved an “information fee” of RMB 500 (USD 78) and a clause stating that the shipped items would remain on the truck for one to two days after arrival. However, the shipper refused to unload the cargo well beyond the agreed period.
On the fourth day, Shi took action. “I contacted Manbang… but the system just closed the deal without offering any help to me,” he said, adding that that Manbang lacked direct and quick communication channels such as a service hotline that users could call in case there are disputes. “I had no other choice but to call 110 [the police emergency line].”
Last year, the firm booked nearly RMB 2.6 billion (USD 395.5 million) in revenue, slightly more than the RMB 2.5 billion in 2019. Its net loss, however, widened to nearly RMB 3.5 billion (USD 531.9 million) in 2020 from RMB 1.5 billion a year earlier.